In this paper, we introduce two sources of unemployment in a two-factor general equilibrium model: search frictions and fairness considerations. We …nd that a binding fairwage constraint increases the unskilled unemployment rate and can at the same time lead to a higher unemployment rate for skilled workers, as compared to an equilibrium where fairness considerations are absent or non-binding. ...

When skilled workers migrate, they face the brain waste risk, i.e., they can end up employed as unskilled. We analyze the effects of brain waste on brain drain, resulting from low international transferability of skills. We show that this type of brain waste: (1) reduces education incentives; (2) weakens the chances for a positive self-selection; and (3) decreases the possibility of a brain gai...

• There were fears in the European Union that eastern enlargement would lead to major job losses and transfers. More recently, these fears have extended to high-skilled and IT jobs. This paper examines using unique firm-level data if these fears are justified for Austria and Germany. • We find that eastern enlargement has led to job losses of less than 0.5 percent of total employment in Germany...

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Information technologies (IT) may substitute for routine/manual tasks and complement complex/problem-solving tasks, which can induce bias towards greater demand for skilled labor. This phenomenon of “skill-biased technical change” has important implications for the impact of IT on factor substitution within a firm’s production process. Understanding how the substitution and complementarity rela...

Any opinions, findings, conclusions, or recommendations expressed in this material are those of the author(s) and do not necessarily reflect the view of the National Poverty Center or any sponsoring agency. The economy is a key determinant of poverty and well-being among low-income families. Reductions in the level of economic demand during recessions can significantly increase the unemployment...

This paper presents a multi-objective Particle Swarm Optimization (PSO) algorithm for worker assignment and mixed-model assembly line balancing problem when task times depend on the worker’s skill level. The objectives of this model are minimization of the number of stations (equivalent to the maximization of the weighted line efficiency), minimization of the weighted smoothness index and minim...

The last few decades of the twentieth century witnessed fairly dramatic changes in the labor market outcomes and socioeconomic status of American workers at the bottom of the earnings distribution. Earnings of the least skilled adults either stagnated or fell. Moreover, labor force participation and employment have declined considerably, suggesting a reduction in demand for the labor of the lea...

The HIV epidemic has dramatically decreased labor supply among prime-age adults in Sub-Saharan Africa. Using within-country variation in regional HIV prevalence and a synthetic panel, I find that HIV significantly increases the capital-labor ratio in urban manufacturing firms. The impact of HIV on average wages is positive but imprecisely estimated. In contrast, HIV has a large positive impact ...

A well-established stylised fact is that employer provided job-related training raises productivity and wages. Using UK data, we further find that job-related training is positively related to subsidies aimed at reducing training costs for employers. We also find that there is a positive, albeit quantitatively small, relationship between wage inequality and training inequality in the UK. Motiva...